YASHITA FINANCE PVT. LTD.,NEW DELHI vs. CIT(A), NEW DELHI

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ITA 6200/DEL/2025Status: DisposedITAT Delhi30 October 2025AY 2016-17Bench: Sh. Satbeer Singh Godara (Judicial Member)2 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the penalty proceedings are parallel to the assessment proceedings and that a disallowance does not automatically lead to a penalty. The Tribunal referred to the landmark decision in CIT vs. Reliance Petroproducts (P) Ltd. to support its view.

What were the facts?

The assessee's appeal for Assessment Year 2016-17 arose from a penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961. The penalty was for various disallowances, including those related to Section 14A, legal and professional expenditure, and interest on refunds under Section 244A.

What were the issues?

Whether penalty under Section 271(1)(c) is leviable when the additions were made based on disallowances which were debatable in nature?

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 14A,Section 244A

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI

Before: Sh. Satbeer Singh Godara

For Appellant: Ms. Tinya, Adv
Hearing: 30.10.2025Pronounced: 30.10.2025

Asstt. Year : 2016-17 Yashita Finance Pvt. Ltd., Vs Income Tax Officer, 8-A, Commissioner Lane, Civil Lines, Ward-27(4), New Delhi-110054 New Delhi (APPELLANT) (RESPONDENT) PAN No. AAACY3088P Assessee by: Ms. Tinya, Adv. Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 30.10.2025 Date of Pronouncement: 30.10.2025 ORDER

This assessee’s appeal for Assessment Year 2016-17, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2025-26/1078279089(1) dated 08.07.2025, in proceedings u/s 271(1)(c) of the Income Tax Act, 1961 (in short “the Act”).

2.

Heard both the parties at length. Case file perused.

3.

Coming straightway to the assessee’s sole substantive ground raised herein, it emerges during the course of hearing that both the learned lower authorities have levied the impugned penalty u/s 271(1)(c) of the Act amounting to Rs.5,76,947/- which pertains to various disallowance u/s 14A, legal and professional expenditure, interest on refunds u/s

4.

The above being the clinching factual position, the Revenue could hardly dispute that their lordships landmark decision in CIT vs. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 (SC) has already settled the issue that quantum and penalty proceedings are parallel in nature wherein each and every instance of such a disallowance does not ipso facto the latter penal provision. The impugned penalty is directed to be deleted in very terms therefore.

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